Zimbabwe’s dollar fell against the US dollar on Tuesday as the central bank launched its first foreign currency auction trading system.

Since March the rate had been fixed at 25 Zimbabwean dollars to $1 to stabilise the currency but that has since weakened.

This was the first of the weekly auctions that the central bank plans to have to determine its foreign exchange rates.

The new system is supposed to bring “transparency and efficiency in the trading of foreign currency in the country”.

The Zimbabwe dollar has weakened considerably since its reintroduction last June, after a decade of using a basket of international currencies including the US dollar.

The US dollar is now back in circulation alongside the volatile local currency as part of Covid-19 measures to stabilise the economy and prices. Nurses and doctors are currently on strike demanding that their salaries are now paid in US dollars.

They rejected the government’s offer to pay a short term Covid-19 related allowance of $75 a month.

High annual inflation which peaked at 785% in May has eroded the value of most salaries.